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Business



by Adam Wilmoth

SandRidge borrows $489 million

SandRidge Energy Inc. last week borrowed almost $489 million, maxing out the credit line it secured early last year, the company said Monday.

The Oklahoma City-based oil and natural gas producer said it plans to use the money for general corporate purposes.

"Our cash is a valuable asset, and in this volatile market, having guaranteed liquidity provides the maximum operation and financial flexibility to SandRidge," spokesman David Kimmel said in a statement Monday. "By fully drawing on our revolver, we ensure that all of our liquidity is readily available to us."

Including the $11 million SandRidge withdrew previously, the company now owes nearly $500 million on the credit line and has $855 million in cash on hand.

SandRidge said it chose to borrow the money after consulting with legal adviser Kirkland & Ellis LLP and financial adviser Houlihan Lokey Inc.

"Over the last several quarters, we have taken several deliberate steps to improve our liquidity and reduce our liabilities," Kimmel said. "By managing and improving our balance sheet, we will be able to fully capitalize on the operational strengths of our company."

SandRidge shares early Monday were down 1.4 cents, or 21 percent, to 5.3 cents a share. The stock moved to the over-the-counter market last month after the New York Stock Exchange removed it from the exchange because of its "abnormally low" share price.

The low share price has dropped SandRidge's market capitalization to about $31 million. The company has about $4 billion in debt.

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